ANNUAL AUDIT REPORT

FOR THE

PROJECT

ON EXPENDITURE SPECIFICATION
70 182J Networking of Student Parliaments

NUMBER

Budget accounts for 2011

COOPERATION AGREEMENT 2011 BETWEEN

UZICE CHILD RIGHTS CENTER AND
OLOF PALME INTERNATIONAL CENTER, SWEDEN

SIDA

FINANCED SUPPORT TO CIVIL SOCIETY

IN WESTERN BALKANS

ORGANIZATIONS

In Belgrade, January 2012

CONTENTS:

Page

INTRODUCTION

II

PROJECT BACKGROUND

III

SCOPE AND NATURE OF THE AUDIT

IV

AUDITOR'S CERTIFICATE

SUMMARY OF WORK CARRIED OUT AND FINDINGS

1.

Contract Review

2.

Reconciliation of cash received and payments

NOTES:
1.

PALME CENTERS CONTRIBUTION

2.

Project manager and Financial manager

3.

Trainers fees peer education

4.

School coordinators

5.

Facilitators network meeting

6.

Lunch and refreshment worksh

7.

Accomodation peer education

8.

Accomodation network meeting

9.
10
.
11
.
12
.
13
.14
.
15
.

Teaching materials peer

Printing of edu and promo mater.

Travel costs

Office costs
Accountant fee
EXCHANGE RATES
REPAY

8
8
8
8

CERTIFICATION

1.

Project Expenditures

2.

Agreement with third party

3.

System of Internal Controls

4.

Interest

5.

Project Reports

6.

Governing Clauses for Co-operation Agreement

VI

Annexes:
Expenditure Specification
Accounts in Foreign Currency
Auditors License

Audit Report

Uzice Child Rights Center

Project No. 70 182J
I

INTRODUCTION

In terms of the scope of the audit identified in Terms of reference - Audit of Projects funded by The Olof
Palme International Center, and in terms of the provisions contained in the Consultancy Agreement
from 27 May 2011 between the Olof Palme International Center, Sweden (hereinafter: Palme Center)
and Privredni savetnik - Revizija, d.o.o. Belgrade, and also in terms of the provisions contained in the
Cooperation Agreement between the Olof Palme International Center, Sweden (hereinafter: Palme
Center) and Uzice Child Rights Center, Uzice, Dimitrija Tucovica street No 60, Serbia (hereinafter:
Cooperation organization) we carried out an audit of the transactions pertaining to the Project
Networking of Students Parliaments, Project number 70 182 J in the period 1 January 2011
31 December 2011. The period of the audit procedures ranges from 10 January 2012 26 January
2012.
II

PROJECT BACKGROUND

Cooperation Organization
Cooperation organization was founded in 1998 as a nongovernmental, non-profitable and nonpolitical
organization.
Mission of the Cooperation organization is to improve the position of children within society.
All activities of the Cooperation organization are based on the principles stated in the Convention on
the Rights of a Child, therefore promoting this Convention as a fundamental document on child rights.
Activists of the Cooperation organization are pedagogues, psychologists, teachers, professors,
sociologists, physicians, lawyers and children.
Project objectives
Project objective is to develop sustainable network of student parliaments as a mechanism for efficient
and meaningful participation of children in decision making processes within the schools and
educational system
Specific objectives
Specific objectives are:
SO1. Build capacities of student parliaments in secondary schools to take more active roles in decision
making at their schools
SO 2. Empower children to act as peer educators in areas of student parliaments management
SO 3. Build capacities of teachers in area of supporting of student parliaments
SO 4. Build capacities of children members of student parliaments in area of student parliaments
management
SO5. Build partnership of adults (teachers) and children in running and working in student parliaments
SO6. Raise awareness of children of importance of active participation in decision making
SO7. Develop and support cooperation of different student parliaments in western Serbia region
Activities of the project
Main activities were:
Activity 1. Preparation and assessment
Activity 2. Training for peer educators
Activity 3. Workshops for members of student parliaments
Activity 4. Consultancy support to Student parliaments
Activity 5. Printing and distribution of educational materials
Activity 6. Creation of Network of Student Parliaments

Project outputs - imidiate

Result 1: Student parliaments have capacities to actively participate in decision making.
Result 2: Youth leaders act as peer educators.
Result 3: Teachers efficiently support work of student parliaments.
Result 4: Children have capacities to efficiently engage in student parliaments Result 5: Partnership of
teacher and children established

Audit Report

Uzice Child Rights Center

Project No. 70 182J
Result 6: Increased awareness of children on importance of active participation achieved.
Result 7: Brochure on Student parliaments created
Result 8: Network of Student parliaments established
Project outputs long term
Long term result 1. Improved capacities for to development and implementation policies and strategies
for more efficient participation of children in society - Each students parliament developed and
implemented at least 1 action (advocacy campaigns, initiatives) in their schools regarding
improvement of school and/or education system.
Long term result 2. Improved knowledge, awareness of various democratic governance issues (i.e.
gender equality, democratic principles, inclusion of marginalized groups and youth, child rights
participation) by student parliament - each students parliament applies democratic procedures in
selection of members and decision making, principle of gender quality and inclusion of marginalized
children more respected as we now have more girls in student parliaments and even some of them as
president of parliaments which was not case in any school before the project.
Long term result 3. More effective, strategic and accountable leadership and management of student
parliament working towards sustainable participation of children in decision making - each students
parliaments have defined mission statement, strategic and action plans. During the project each
student parliament redefined and adopted new mission statements and numerous changes in status of
student parliament that ensured more efficient work. One of the most important changes related to
promotion of child rights and child participation rights.
Long term result 4. Sustainable mechanism for cooperation and development of student parliaments
established. This project resulted with important outcome that is related to establishment of Network
of Student parliaments. This network in great playground for each single student parliament to
practice partnership, cooperation and exchange of knowledge and experiences for their further
development. Furthermore, it will provide opportunity for children to make more significant influence
on all matters of their concern.
III
1.

SCOPE AND NATURE OF THE AUDIT

Clients Audit Requirements

Privredni savetnik - Revizija d.o.o. Belgrade signed Consultancy Agreement with Olof Palme
International Center Stockholm, Sweden, on 27th of May 2011. Pursuant to the provisions of this
Contract Privredni savetnik Revizija d.o.o. Belgrade will carry out an audit of the Cooperation
Agreement between the Olof Palme International Center, Sweden and Co-operation organization.
The requirement is for audit certificates that the funds provided by Palme Center for the Project have
been allocated and used in accordance with the budgetary provisions of the Agreement.
2.

Scope of the Audit

The audit required by Olof Palme Center stipulates such tests deemed necessary to give reasonable
assurances that the Income and Expenditures reported in the Co-operation organizations Financial
Statements are bona fide and have been incurred in accordance with the Agreement.
The auditor shall make a special examination to ascertain that:
1. The organization has signed agreement with the organization to which it channel Sida funds,
(Olof Palme International Center Stockholm, Sweden),
2. Sida funds are kept separately in a separate bank account,
3. The financial report to Sida is made against the budget approved by the Swedish NGO (OPC) and
contains explanations for any deviations,
- The auditor verifies that the report against the budget corresponds with the accounts and thus
provides a true and fair view,
- The auditor verifies that explanations of deviations from budget are provided and that the
explanations are not contradicted by other parts of the report or by any other information
possessed by the auditor on the audited organization,
4. The organization has internal regulations in respect of procurements and has followed these
regulations in its procurements,

Audit Report

Uzice Child Rights Center

Project No. 70 182J
5. The organization has followed Sidas regulations in respect of procurements.
3.

Audit Steps

The auditor will undertake audit steps as following:

1.
2.

Check that the audited organizations report to the donor organization follows the agreement;
Check that the costs reported by the audited organization to the donor organization
correspond with those in the accounts;
3. Check that the costs are made in accordance with the project document and the project
budgets with explanation of deviations;
4. Check that the costs are valid and supported by adequate documentation;
5. Check that the activity report and the financial report correspond to each other;
6. Check that the audited organization has signed agreements with the organizations to which it
channels the grant;
7. Check that interest earned by that the audited organization has been reported and used for
the activities;
8. Check that unused funds have been reported;
9. Check that the audited organizations bank account for Sida funds is to be signed for by at
least two persons jointly;
10. Check that an appropriate system of internal controls has been incorporated into the project
and may be relied upon.
11. Check that the Sida guidelines concerning procurement has been followed in all purchases of
services and goods;
12. Check that the project organization has followed the project country law concerning salaries as
well as tax payments.
4.

Audit Scope Restriction

The audit is limited to the funds provided by Palme Center only, and the Report does not cover other
funds that the cooperation organization was using for this, and other projects implemented during the
audited period.
4. Specific Objectives of the Audit
Objective 1 Project expenditures
Project expenditures are made in accordance with the project document and the project budgets;
Project expenditures are valid and supported by adequate documentation.
Objective 2 System of internal controls
An appropriate system of internal controls has been incorporated into the project and may be relied
upon.
Objective 3 Project reports
To give an opinion on the Financial Statements of the Project financed by the Palme Center in
particular, whether they present a true and fair picture of the Project revenue. The audit must state, as
minimum that financial statements of implementing partners are fairly stated and conform to Sida
Guidelines for Financial Reporting and Generally accepted accounting principles.
Objective 4 Governing Clauses for Co-operation Agreement
To make observations in order to determine whether the implementing partner has satisfied in every
substantive respect the conditions of the Palme center Co-operative Agreement.
Objective 5 Significant Observations
To define possible recommendations to the audited organization in respect of the observations
reported by the auditor.

Audit Report

PRIVREDNI SAVETNIK - REVIZIJA DOO

A MEMBER OF AGN INTERNATIONAL LTD
NGO.004-8-2012
IV

AUDITORS CERTIFICATE

We have audited the accompanying Financial Report for year 2011, project number 70 182 J which has
been submitted by the organization Uzice Child Rights Center, Uzice, Dimitrija Tucovica street No 60,
Serbia under its agreement with Sida, signed on 24th February 2011.
The audit has been performed in accordance with generally accepted auditing standards, International
Standards on Auditing (ISA) and in accordance with The Olof Palme International Centers Audit
Instructions.
The financial report submitted by the organization has been established in accordance with the above
agreement with Uzice Child Rights Center, Uzice and is in accordance with the organizations
accounting records and agreed budget.
The internal control of the project gives no cause for remark.
We recommend that the accounts and report be approved.
We must note that our audit was limited to the review of the contributed funds and amounts expended
in that respect, and did not include an overall insight into the entity as a whole. Therefore, our audit
may not have revealed all the control weaknesses that might exist within the entire accounting system
of the Uzice Child Rights Center, Uzice, Dimitrija Tucovica street No 60, Serbia.

Belgrade, 26 January 2012

Privredni savetnik - Revizija
Milo Petrovi (Chief executive officer), CPA

4
PRIVREDNI SAVETNIK REVIZIJA DOO, BELGRADE, KNEGINJE ZORKE 96
REGISTERED IN THE REGISTER OF COMPANIES, BELGRADE, REG. NO. 15686/2005, IDENTIFICATION NO. 17200569;
PIB 100290705;
BANK ACCOUNTS NO.: 275-220009202-12 SOCIETE GENERALE BANKA SRBIJA AD, BELGRADE;
205-143148-63 KOMERCIJALNA BANKA AD, BELGRADE
TELEPHONES: GENERAL MANAGER: +381 11 30-20-562; CERTIFIED AUDITORS: +381 11 30-20-722, +381 11 3020-732;
FAX: +381 11 30-20-686; E-MAIL: MILOS@PSR.RS , REVIZIJA@PSR.RS ; WEB: WWW.PSR.RS

Uzice Child Rights Center

Project No. 70 182J
V

SUMMARY OF WORK CARRIED OUT AND FINDINGS

Privredni savetnik - Revizija has carried out auditing in the period 10th 26th January 2012.
1.

Contract Review

Contract between Palme Center and Co-operation organization exists, and was presented to audit
team. The Contract is signed on 24 th February 2011, and stipulates Project activity implementation
period of 12 (twelve) months.
1.1.

Palme Centers Contribution

For the period January 1 st 2011 December 31st 2011, Palme Centers contribution to the Project will be
up to maximum of SEK 200.000.
1.2.

Dates of Installment Transfers

First installment amounting SEK 100.000 or 11.412,75 was transferred to co-operation organization
on 22nd March 2011.
Second installment amounting SEK 100.000 or 10.901,65 was transferred to co-operation
organization on 29th August 2011.
1.3.

Reporting

The midterm report is to be submitted to Palme Center no later than 15 June, whereas the final report
is to be submitted after the completion of the project implementing period, no later than 1
February.
1.4.

Project Budget

The approved budget for this Project was SEK 200.000.

Total approved budget of the Project is as given here bellow:

Budget Items
Project manager
Financial manager
Trainers fees peer education
School coordinators
Facilitators network meeting
Lunch and refreshment worksh
Accomodation peer education
Accomodation network meeting
Teaching materials peer
Printing of edu and promo mater.
Travel costs
Office costs
Accountant fee
Total

Audit Report

Budget
(In Swedish
Crowns)
33.030
26.536
11.186
20.000
8.389
10.560
26.500
27.400
7.500
16.874
3.845
5.540
2.640
200.000

Expenses In
Swedish Crowns
(1.1
31.12.2011)
33.933
27.263
11.186
20.469
8.782
10.661
25.533
24.837
7.903
16.874
3.867
5.681
2.639
199.628

Expenses in EUR
(1.1.31.12.2011)
3.770
3.028
1.277
2.283
957
1.178
2.914
2.708
885
1.926
428
621
294
22.269

Uzice Child Rights Center

Project No. 70 182J
2.Reconciliation of cash received and payments for period January 1
2011:

st

December 31st

A: INCOME as of December 31st 2011

FUND TRANSFER

100.000
100.000

Amount in
EUR
(without Bank
costs)
11.412,75
10.901,65

299

33,46

200.299

22.347,86

Amount in SEK

Income (first installment) 22nd March 2011

Income (second installment) 29th August 2011
Net Income interests earned (1 January - 31
December 2011)
A - TOTAL INCOME

Notes
1
1
1

Less
B: EXPENSES as of 31st of December 2011
Budget item

Expenses In
Swedish Crowns
1.1 31.12.2011.

Project manager
Financial manager
Trainers fees peer education
School coordinators
Facilitators network meeting
Lunch and refreshment worksh
Accomodation peer education
Accomodation network meeting
Teaching materials peer
Printing of edu and promo mater.
Travel costs
Office costs
Accountant fee
B - TOTAL COSTS
FUND BALANCE A-B

33.933
27.263
11.186
20.469
8.782
10.661
25.533
24.837
7.903
16.874
3.867
5.681
2.639
199.628
671

Expenses in
EUR
1.1.31.12.2011.
3.770
3.028
1.277
2.283
957
1.178
2.914
2.708
885
1.926
428
621
294
22.269
78,86

Note
s
2
2
3
4
5
6
7
8
9
10
11
12
13

NOTES:
1.

PALME CENTERS CONTRIBUTION

Palme Center transferred contribution in the amount of SEK 200,000.00 (EUR 21.314,40) at the
separate bank account no. 180501121002475328, opened at Alpha Bank Srbija AD, Belgrade.
The Olof Palme Center bank account is interest bearing one. In the period January 1 st - December 31st
2011, the Cooperation organization reported interest earned in amount of RSD 9.154 or SEK 801 or
89,45. In the same period, Cooperation organization was charged for bank provisions on donated funds
in the total amount of RSD 5.733 or SEK 502 or 56,07. Our audit team confirmed the interest earned,
based on bank statements prepared by Alpha Bank Srbija AD, Belgrade.
2.

Project manager and Financial manager

These budget items consist of honorariums and adequate tax payments charged for Project manager
and Financial manager, involved into the Project implementation.
All contracts on authorship were presented to audit team.

Audit Report

Uzice Child Rights Center

Project No. 70 182J

3.

Trainers fees peer education

These budget items consist of the honorariums and adequate tax payments charged for three trainers
involved into the Project implementation.
All contracts on authorship were presented to audit team.
4.

School Coordinators

This budget item consists of the honorariums and adequate tax payments charged for ten trainers for
promotion of child rights in Kosjeric, Uzice, Pozega, Arilje and Bajina Basta.
All contracts on authorship were presented to audit team.
5.

Facilitators network meeting

This budget item consists of honorariums and adequate tax payments charged for two project
assistants for creating and realization of two-day conference with children.

6.

Lunch and refreshment workshops

These budget items consist invoices for lunch and refreshments, for 10 independent workshops for
children members of students parliament.
7.

Accomodation peer education

This budget category comprises invoice of Mark MD from Uzice for accomodation, food and
refreshment of conference participants that took place in hotel Zlatiborska noc in the period 19 22
March 2011. and 8 August 2011.

8.

Accomodation network meeting

This budget category comprises invoice of UT Sloga and Mark MD from Uzice for accomodation,
food and refreshment of conference participants that took place in hotels Zlatibor and Zlatiborska
noc in the period 12 14 August 2011 and 25 26 November 2011.
9.

Teaching material - peer

These budget items consist invoices for office supplies and photocopying.
10. Printing and distribution of educational and promo materials
This budget category comprises invoice of Pasograf SZR from Uzice for printing broshures Guide
students' parliament.

11. Travel costs

This budget item consists of invoices for transportation of conference participants.

Audit Report

Uzice Child Rights Center

Project No. 70 182J
12. Office costs
This budget category comprises invoices for rental office, internet and electricity.

13. Accountant fee

This budget category comprises invoice for legal services from bookkeeping agency MKD, Uzice.

14. EXCHANGE RATES

Specification:
Date
22nd March 2011
29th August 2011
Total:

Amount received in
Amount received in
foreign currency
local currency (RSD)
(EUR)
11.412,75
1.175.513
10.901,65
1.106.517
22.314,40
2.282.031

Exchange
rate
(RSD/EUR)
103,00
101,50

Exchange
rate
(RSD/SEK)
11,7551
11,0651

Those exchange rates were used for converting of expenditures from RSD into EUR and SEK.
15.

REPAY

The unspent amount at the end of the Project period is EUR 78,86.
According to the article 5.1 of the Cooperation Agreement with the Olof Palme Center amounts under
SEK 500.00 (approximately EUR 50.00) do not require reimbursement.

VI
1.

CERTIFICATION
Project Expenditures

Project expenditures are made in accordance with the project document and the project budgets.
Project expenditures are valid and supported by adequate documentation. There were budget
deviations in the audited period.
There were small deviations to the budget line to several budget lines that are with in 1-4% of total
budget planned for those budget lines. In absolute values those deviations are between 22 SEK to 903
SEK which are very small amounts. Those deviations are due to the application of three different
exchange rates that Uzice Child Rights Center needed to use (RDS, EUR and SEK) and to the fact that
Uzice Child Rights Center received 2 instalments with significantly different rates so more precise
implementation of planned budget was not possible.
The only budget line that has more significant deviation in absolute value is related to Accommodation
network meeting - 2.562 SEK unspent. This amount is 10.75% of total of this budget line. This is due to
very good prizes that Uzice Child Rights Center managed to negotiate with hotel and get extra
discount from them.
2.

Agreement with third party

The granted funds have not been channeled to other organizations.

3.

System of Internal Controls

Palme Centers funds are kept in a separate bank account.

Audit Report

Uzice Child Rights Center

Project No. 70 182J
An appropriate system of internal controls has been incorporated into the project and may be relied
upon.
The accounting system, internal procedures, internal control and documentation are in general
adequate.
Cooperation organization has adequate internal structure with clear segregation of duties. All the
project documentation was correctly presented.
The fund disbursements were properly approved and documented, and the reporting system is in
compliance with Palme Center Financial Management guidelines.
4.

Interest

The Olof Palme Center bank account is interest bearing one. In the period January 1 st - December 31st
2011, the Cooperation organization reported interest earned in amount of RSD 9.154 or SEK 801 or
89,45. In the same period, Cooperation organization was charged for bank provisions on donated funds
in the total amount of RSD 5.733 or SEK 502 or 56,07. Our audit team confirmed the interest earned,
based on bank statements prepared by Alpha Bank Srbija AD, Belgrade.
5.

Project Reports

This audit confirms that the projects financial accounting and reporting is in compliance with Sida
Guidelines for Financial Reporting and Generally Accepted Accounting Standards.
All amounts reported to Palme Center are in accordance with the books of accounts and have been
correctly classified in accordance with Local Accounting Standards.
All incomes and expenses, coming from Palme Center are also registered in excel spreadsheets, and
give correct and reliable evidence about all transactions within the Co-operating organization.
6.

Governing Clauses for Co-operation Agreement

The project costs are appropriate to the objectives and the size of the project. Co-operating
organization has satisfied in every substantive respect the conditions of the Palme Center Co-operative
Agreement.

Annex: Finance Report

Accounts in Foreign Currency

Audit Report